Why lawmakers are concerned about foreclosure on mortgages

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State legislators are calling for a bill designed to reflect a court ruling they fear could lead to more foreclosures in New York.

This is a decision by the Court of Appeal this year that allows mortgage banks in foreclosure claims to nullify the six-year statute of limitations when determining voluntary termination as an acceleration in debt repayment. Banks will be the only plaintiffs in New York who, in fact, are not subject to the statute of limitations in these cases.

A bill to tackle this problem, backed by Senator James Sanders and MP Latrice Walker, will prevent banks from changing the statute of limitations by voluntarily terminating it. And it will prevent banks from suing the homeowner for monetary judgment if the mortgage has expired.

And this measure will restrict the bank from using the law to renew the new action within six months after the expiration of the statute of limitations only once.

“Given the state of the economy during the COVID-19 pandemic and even before that, Southeast Queens suffered a flurry of home foreclosures,” Sanders said. “The New York State Court of Appeals ruling earlier this year even made matters worse by giving mortgage lenders an undue advantage over homeowners in litigation. My legislation would ensure a fair process during foreclosures and prevent many foreclosures. ”

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